Understanding Trucking and EDI

Understanding-Trucking-and-EDI featured

Trucking companies handle a ton of paperwork daily. It would help if you had all of that information readily available for your bookkeeper and accountant so they can prepare your company’s financial statements readily. The Electronic Data Interchange (EDI) standard is a common way businesses handle paperless transactions and access their accounting, billing, purchasing, and other system data electronically. It’s a concept to take into consideration in your plan to become a professional trucking company owner. This article explains EDI and how it can help you run your organization more efficiently and successfully.

 

What is EDI?

Electronic data interchange (EDI) is a way for companies to send and receive data electronically, to improve efficiency and save costs. Companies use EDI to electronically transmit information about orders, shipments, purchases, sales, and expenses. When you start a trucking company, one of the first things you need to do is acquire an EDI system. The benefits of using EDI software are numerous. The EDI system can manage your company’s paperwork and help reduce errors. You can also track where your inventory is and what is being purchased. If a customer places an order, you can see that as well. All of this information is available in one system.

 

How does an EDI system work?

The fundamental idea is that a trucking company can exchange documents electronically with clients and supply chain partners using their transportation management system. For its customers to receive the document automatically, the carriers’ EDI suppliers will take a processed document and electronically map it to their software. Paperwork, email, and manual data entry are gone.

A document sent via EDI must pass through a secure network for the data to be transferred from the shipper to the carrier and vice versa. This “value-added network,” or VAN, frequently raises the transaction’s cost. By lowering the number of partners that an organization must connect with, a Value-Added Network (VAN) streamlines the communications process. To eliminate these “middlemen” costs, carriers can opt for an EDI provider with a built-in VAN service.

Understanding-Trucking-and-EDI MiddleBenefits of an EDI System for Trucking Company

  • Help reduce cost – You can eliminate paper from your business operations. Paper can be expensive to maintain, store, and transport. In addition, errors in paper-based processes are common.
  • Speed up operations – An EDI system gives you access to your information at Internet speed. It helps you avoid delays that result from paper-based processes.
  • Better customer experience – You can offer your customers a paperless experience with your company’s EDI system. This can result in a better shopping experience for your customers and better customer satisfaction.
  • Better control of your company – Using an EDI system gives you a complete view of your company’s operations. You can see your trucks and what they do at any given time. You also have access to your customer information and inventory.

 

The Future of EDI in Transportation

The times are continuously changing, and innovation is happening fast, as with anything related to technology. Many carriers are currently switching to API (Web Services) for information trading. However, the necessity to use this new technology is not as pressing as some businesses would have you believe. For many trucking companies, EDI remains an excellent tool and will do so for a long time. With TMS Digital, carriers can use the best of both worlds to their advantage, running integrated EDI and API-based systems to communicate real-time data from beginning to end. Many things can be automated with an EDI system. The software can be used to track the location of your fleet, monitor its fuel levels, and track its maintenance needs. It can even provide you with a comprehensive overview of the health of your entire operation.

 

Conclusion

EDI systems increase compliance, decrease manual data input errors, and speed up information access for each trading partner. Implementing EDI technology will help you improve communication with your logistics partners and the efficiency of your supply chain.

At TMS-Digital, our team of experts will assist you through every step of your trucking journey from start to finish, from dispatch to drafting a plan to file your IFTA and to ensure your equipment is maintained and in top condition for your daily deliveries.

Contact us today to understand how our EDI makes your paperwork flow easier and how we can streamline your operations securely.

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